ADT Security Services, Inc. v. Security One International, Inc. et al

Filing 403

ORDER RE: DISCOVERY IN CONNECTION WITH ADTS APPLICATION FOR ORDER TO SHOW CAUSE(Re: Dkt. Nos. 377 , 391 ). Signed by Judge Gonzalez Rogers on 7/12/2016. (ygrlc1S, COURT STAFF) (Filed on 7/12/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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ADT SECURITY SERVICES, INC.,

Case No. 11-cv-05149-YGR

Plaintiff,
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ORDER RE: DISCOVERY IN CONNECTION
WITH ADT’S APPLICATION FOR ORDER TO
SHOW CAUSE

v.
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SECURITY ONE INTERNATIONAL, INC., ET
AL.,

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United States District Court
Northern District of California

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Defendants.

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Re: Dkt. Nos. 377, 391

Plaintiff ADT Security Services, Inc. (“ADT”) filed a Motion for Order to Show Cause

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regarding alleged contempt by Defendant Security One International Inc. (“Security One”). (Dkt.

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No. 377.) The Court heard argument on June 7, 2016.1 Subsequent to the hearing, the parties

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submitted requests for additional discovery in connection with the motion. (Dkt. No. 399, 401.)

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The permanent injunction in this matter provides, in part, that Security One is prohibited

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from “[m]aking any false representation to any ADT customer while soliciting the customer’s

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business, including without limitation, as it relates to their relationship and/or affiliation with the

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manufacturer of the customer’s alarm equipment (i.e. General Electric or Honeywell).” The

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question central to determining whether Security One acted in contempt of this provision of the

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permanent injunction is: did Security One falsely represent that it was “an authorized GE Security

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Dealer” as of the time of the calls at issue?

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The parties are in agreement that a deposition from the person most knowledgeable about

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Defendant Security One filed a Motion for Order to Show Cause regarding alleged
contempt by ADT, on which the Court heard argument June 7, 2016, as well. Subsequent to the
hearing, in their June 15, 2016 filing, Security One indicated that, based upon ADT’s
supplemental filing on May 26, 2016, Security One no longer seeks additional discovery on the
subject of its contempt allegations, but rests on its papers and requests only an award of attorneys’
fees and an admonishment of ADT for its conduct. (See Dkt. No. 401 at n.2.)

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the relationship between Security One and UTC Fire & Security Americas Corporation (“UTC”),

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the company that acquired GE Security in March of 2010,2 is necessary to answer the central

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question here. The Court agrees that this discovery is appropriate and ORDERS that the parties

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may conduct a Rule 30(b)(6) deposition of a representative of UTC on the subjects of the

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relationship between UTC and Security One; any authorization by UTC permitting Security One

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to represent itself as an authorized GE Security dealer; and any efforts undertaken by Security One

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to clarify that relationship and authorization from October 2013 to present.
In addition, however, ADT seeks discovery ranging beyond these limitations. First ADT

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United States District Court
Northern District of California

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asks that the Court permit discovery related to UTC, including:
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all communications between UTC and Security One from September 2013 to present;
all records of UTC concerning that relationship; and
records concerning UTC’s decision to terminate all dealers’ rights to claim GE dealer
status.

Reaching beyond this, ADT seeks discovery from Security One encompassing:
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all recordings of telemarketing calls placed from October 2013 to the present;
all call scripts defendants provided the telemarketers from October 2013 to the present; and
all customer call lists defendants gave the telemarketers from October 2013 to the present.

And with respect to ADT’s anticipated damages, ADT also seeks production of:
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defendants’ list of customers who signed contracts with Security One from October 2013
to the present; and
the contracts by which defendant sell their new accounts to other companies.

The Court finds that this requested discovery far exceeds the bounds of the alleged contempt at
issue here. Of the requests, only discovery concerning the content of the telemarketing scripts
during the time period enc the alleged violations in ADT’s “Notice of Alleged Violation” appears
appropriate at this juncture. Thus, the Court will permit discovery of Security One telemarketing
scripts in use from October 2013 to August 2015.
Absent further evidence, arising from the Rule 30(b)(6) deposition or otherwise, that
Security One has engaged in conduct in violation of the injunction, the request for authorization to

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See Declaration of Angie Gomez, Dkt. No. 377-1, at ¶ 4.
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engage in this additional discovery is DENIED.

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Therefore, based upon the foregoing, the Court ORDERS:

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(1) the parties shall notice a Rule 30(b)(6) deposition of a representative of UTC to be

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conducted no later than August 5, 2016; and
(2) Security One shall produce to ADT, pursuant to the terms of the parties’ stipulated

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protective order, all telemarketing scripts in use by Security One from October 2013 to August

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2015 no later than August 5, 2016.

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Once the discovery is completed, ADT may submit a supplemental brief of no more than
10 pages no later than August 12, 2016. Security One may file a responsive supplemental brief of

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no more than 10 pages no later than August 19, 2016. The Court will notify the parties if further

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United States District Court
Northern District of California

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hearing is required, and will entertain any reasonable, joint request to modify this schedule.

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IT IS SO ORDERED.
Dated: July 12, 2016
______________________________________
YVONNE GONZALEZ ROGERS
UNITED STATES DISTRICT COURT JUDGE

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